3 weeks and counting....http://www.markit.com/information/affiliations/abx Only thing thats bounced is AAA stuff. nasty.
ABX volatilities actually hit NHs this week. I'd expected to see a contraction with the big banks feeding at the window. Buying the equity markets at these levels is a fool's game.
10 weeks and counting..BBB's more new lows. Single A's now hitting new lows as well. AA's fading. AAA's flatlining.
12 weeks and counting..BBB's(17) new lows. Single A's(27) new lows . AA's(48) new lows . AAA's (80) new lows. everything essentially plummeting last couple of weeks. http://www.markit.com/information/products/abx.html
There is a run going in structured finance right now and that makes equity markets very risky. There is no doubt we are going to test 1375.
interestingly ABX prices held up the last few days. Surprising in light of the headlines. Next week should be interesting.
What's the damage? Why banks are only starting to uncover their subprime losses By Gillian Tett and Paul J Davies Sun Nov 4, 1:15 PM ET When Merrill Lynch, the US bank, announced 10 days ago that it was taking $8bn-worth of losses on mortgage-related securities, bankers and regulators around the world reeled in shock. For the writedown was twice the size of the losses that Merrill had forecast just a two and a half weeks earlier - a "staggering" multi-billion dollar gap, as Standard and Poor's, the US credit rating agency, observed. But last week, investors received an even more staggering set of numbers. As financial analysts perused Merrill's results, some came to the conclusion that the US bank could be forced to make $4bn more write-offs in the coming months. These calculations were not limited to Merrill: after UBS (NYSE:UBS) unveiled $3.4bn (EU2.3bn, £1.6bn) of third-quarter mortgage-related losses last week, Merrill Lynch analysts warned that the Swiss bank would need to take up to $8bn more losses in the fourth quarter of this year. Meanwhile, Citigroup (NYSE:C)'s share price slumped on rumours that it may need to acknowledge another $10bn of losses. Such a tsunami of red ink would undoubtedly be shocking at any time. But right now, this news is proving particularly unsettling for investors for two particular reasons. First, the numbers offer an unpleasant reminder that the pain from this summer's credit turmoil is still far from over - contrary to what some bullish American bankers and policymakers were trying to claim a few weeks ago. "To judge from secondary market prices, losses on mortgage inventory are likely to be larger in the fourth quarter than the third quarter," warns Tim Bond, analyst at Barclays Capital, the UK bank. Second, the write-downs have reminded investors just how little is known about where the bodies from this summer's credit turmoil might lie. Perhaps the most shocking thing about recent announcements is that while big banks might have now written down their mortgage holdings by more than $20bn, this does not appear to capture all the potential losses. Last week, for example, a US congressional committee warned that over the next year mortgage lenders could foreclose on 2m American homes, destroying $100bn of housing value. And some private sector economists think the total loss from mortgage problems could reach $200bn or more. "What everyone keeps asking is where are those losses sitting - where is the rest of that $100bn?" admitted one senior international policymaker late last month. "The worrying thing is that there still is just so much uncertainty around."